6 trading tips for share market
Whether you are looking to invest and grow your money in the short-term, or have a long-term plan in mind to strengthen your financial position, the share market can offer you some good options to consider. However, it’s important that you do your homework well to understand how the market works, identify the good companies from those that are fake, and decide your budget before making your investment.
The share market today has emerged as a preferred choice for many to invest their money and rake in the profits. Here are some trading tips that can help you in your endeavour, provided you too want to join the bandwagon:
- Decide your trading capacity and stay within your limits: Since it’s difficult to predict the sudden rise and fall of share market today, it’s important that you plan well and act wisely. To begin with, you should set a budget for your share market live trading, and stick to it. Never give in to the temptation of overtrading. In fact, it’s wise to trade well within your limits, and never trade close to the margin, if you can help it.
- Diversify: Rather than putting all your money in one place, invest in various sectors like debentures, shares, bonds and so on. The trick is to diversify your portfolio to have a balanced risk.
- Set realistic targets: Keep a close eye on the daily business news to know how the market is faring and what the future predicts. In addition to your own homework, such information will help you to set realistic targets, and trade with patience.
- Stick to your trading strategy: You should always follow stoploss, and not get afraid of losing. It’s also advisable not to cut positions in loss prior to stoploss, or exit in minor profit before you reach the desired target.
- Take calculated risks: If you always plan to play safe in your share market live trading, you might not bring in the profits. So, don’t be a seller or buyer always. Use your own judgement, as well as what the market trends and business news predict. Take calculated risks, and don’t be afraid of buying at high prices and selling at lower prices. Also, make sure that you choose companies with a strong foundation for long positions.
- Keep an eye on your portfolio: Your job doesn’t end once you have bought the stocks and shares. You should keep a close eye on how they are faring. For this, it’s important to know how to read a stock quote. So, get yourself educated and start tracking how your investment is performing.
Use these tips to become a successful trader in the stock market.
About the author:
A finance blogger with avid interest in equities, markets, commodities, currencies and ipos. I hold an important position in a reputed brokerage firm with its presence globally